Technology transfer, franchising and licensing: recording patent and trade mark licences with RDB as a condition of validity, the anti-competitive clauses listed in Articles 47 and 212 of Law N° 055/2024, vertical restraints under Law N° 011/2026, trade secrets and know-how, and the 15% withholding tax, 2% deduction cap and VAT on royalties

No technology transfer or franchise statute: where the rules come from

Rwanda has no statute dedicated to technology transfer agreements and no franchise law: there is no franchise registration, no mandatory pre-contract disclosure document and no government approval of royalty rates. The United States Department of State's 2026 Investment Climate Statement records that the Government does not impose conditions on the transfer of technology. The rules that do apply are spread across five instruments, and a licensor that ignores any one of them can find its licence unenforceable, its clauses void or its royalties taxed twice.

The first is Law N° 055/2024 of 20/06/2024 on the protection of intellectual property (the IP Law), in force since 31 July 2024, which makes the recordal of patent and mark assignments and licences a condition of their validity, lists clauses that are treated as anti-competitive, and protects secret information. The second is Law N° 011/2026 of 26/02/2026 relating to competition and consumer protection, in force since 4 March 2026, which regulates vertical agreements and the use of intellectual property rights to exclude competitors. The third is Law N° 45/2011 of 25/11/2011 governing contracts, the general law on formation, interpretation and remedies described in Commercial contracts in Rwanda. The fourth is the income tax and VAT legislation, which taxes royalties at source and limits their deduction. The fifth is the investment and foreign exchange framework, which governs payment of royalties abroad. Registration of the underlying rights is covered in The IP law and trade marks and Patents, utility models and industrial designs.

Recording licences and assignments: validity depends on it

The IP Law adopts a strict rule. A patent or a pending patent application may be assigned by a written contract signed by both parties, and the assignment "becomes valid and enforceable if it is recorded in the register of patents" (Article 42(1) and (4)). A patent owner may grant an exclusive, semi-exclusive or non-exclusive licence by a written contract signed by both parties, and "the patent licence becomes valid and enforceable if it is recorded in the register of patents" (Article 44(1) and (3)). The same rules apply to registered marks: an assignment is valid and enforceable once recorded in the register of marks (Article 207(3)), and so is a mark licence (Article 209(3)). An unrecorded licence is therefore not merely unopposable to third parties, as in many systems; on the wording of the Law it is not valid and enforceable at all, which puts at risk the licensee's right to use the mark and the licensor's ability to sue on the contract in Rwanda.

The filing duty falls on the party acquiring the right. Upon payment of the prescribed fee, the assignee submits the signed assignment contract to the competent authority, which records the change of ownership and publishes the details (Articles 42(3) and 207(2)); the licensee submits a copy of the licence contract, and RDB records the subject matter of a patent licence, or the fact of a mark licence, and keeps the contract itself confidential (Articles 44(2) and 209(2)). In practice the filing is made to the Intellectual Property Division of RDB's Office of the Registrar General, and a party resident or established outside Rwanda acts through an industrial property agent authorised by RDB (Article 251(2)). A recorded licence is withdrawn from the register when the contract is terminated by either party or the patent or mark is invalidated (Articles 45 and 210), so the parties should notify RDB when a licence ends, or the register will continue to show a licensee that no longer has rights.

RDB applies the fees in its published tariff, which derives from Ministerial Order N° 24 of 17/03/2016. Article 384 of the IP Law kept the earlier fee orders in force for only six months from its publication, to about 31 January 2025, and no successor order had been located at 10 October 2026, so the amounts below are RDB's published tariff rather than a current Ministerial Order. Copyright and software licences are not recorded (Copyright, software and digital content).

The competition screen: clauses RDB will not record

Recordal is not a formality. RDB does not record a patent assignment if a clause, or the contract as a whole, has the intention or likely effect of lessening competition, restraining trade, abusing a position of market power conferred by the patent or unduly limiting the dissemination of technology (Article 43(1)), and it does not record a patent licence that has an anti-competitive effect (Article 46(1)). Before deciding it may hear the parties and seek the advice of the organ in charge of competition regulation, which since March 2026 is the authority applying Law N° 011/2026, the Rwanda Inspectorate, Competition and Consumer Protection Authority (RICA). A refusal may be appealed to the Appeal Committee within 30 days of notification (Articles 43(3) and 46(3)). A restriction on the licensee or assignee that is neither required by the IP Law nor reasonably necessary to safeguard the patent is considered anti-competitive (Articles 43(4) and 46(4)).

Article 47 then lists eight patent licence clauses that are considered to have an anti-competitive effect, and an Order of the Minister may add others. For marks, RDB refuses to record a licence that contains clauses constituting unfair competition, or where the licensing is likely to mislead consumers as to geographical origin, quality, nature, characteristics, manufacturing process or suitability for use (Article 211(1)); a restriction not reasonably necessary to safeguard the registered mark has the effect of unfair competition (Article 211(4)); and Article 212 lists seven clauses that create a rebuttable presumption of unfair competition. The difference matters: a patent licence clause on the Article 47 list is treated as anti-competitive, while a mark licence clause on the Article 212 list can be defended with evidence, typically that it protects the quality the mark signifies, which Article 211 itself treats as a legitimate concern.

Franchising: building the agreement from Rwandan law

A franchise in Rwanda is a bundle of rights granted under general law: a licence of the franchisor's registered marks, which must be recorded with RDB to be valid; a licence of copyright in the operations manual, recipes, software and designs, which needs no recordal but should be in writing; and a licence of know-how and secret information, protected by contract and by Article 276 of the IP Law. The contract itself is governed by Law N° 45/2011 of 25/11/2011 governing contracts, and the parties may choose a foreign governing law and arbitration, subject to mandatory Rwandan rules on competition, consumers, tax, currency and employment (Arbitration law and KIAC). The first step is therefore always to register the marks in Rwanda, nationally through RDB or by designating Rwanda under the Madrid Protocol, because only a registered mark can be licensed under Article 209.

Three common franchise clauses need care. Territorial and channel restrictions: a clause that limits in any way the licensee's opportunities to sell goods bearing the mark on internal or external markets is presumed to be unfair competition under Article 212(f), and Article 5 of Law N° 011/2026 separately prohibits vertical agreements that have as their object the prevention of effective use of the internet to buy or sell, so an outright ban on online sales by a franchisee is not available. Approved suppliers: an obligation to buy inputs or equipment from the franchisor is presumed unfair under Article 212(d); a quality specification that any supplier meeting the standard may satisfy is easier to defend than a purchasing tie. Pricing: Article 5 prohibits minimum resale price maintenance, while recommended prices are allowed if marked as recommended, and a franchisor may not fix the franchisee's minimum retail prices.

Where a restriction is commercially necessary, Article 6 of Law N° 011/2026 allows the competition authority to authorise an otherwise prohibited agreement on efficiency grounds, for a limited period (Article 7). Fines for prohibited agreements reach 5% of the preceding year's annual turnover (Article 66). A franchisee selling to consumers also carries the consumer duties of Law N° 011/2026, and, if it sells online, the e-commerce licence and disclosure rules described in E-commerce, fintech and AI.

Trade secrets, know-how and software

Know-how is often the most valuable part of a technology transfer, and Rwanda protects it as secret information under the unfair competition chapter of the IP Law. Information is secret if it is unknown or not easily accessible, has commercial value because it is secret, and its holder has taken reasonable steps to keep it secret (Article 276(3)). Disclosure, acquisition or use without the holder's consent in a manner contrary to honest commercial practices is unfair competition, and Article 276(2) gives examples: industrial or commercial espionage, breach of contract, breach of confidence, inducing any of these, and acquisition by a third party who knew of the wrongdoing. Unauthorised use of a competitor's patented invention, design, mark, technical formula or manufacturing method is also unfair competition (Article 275), and the holder may sue in the competent court for cessation and damages (Article 277). Theft of a formula of invention is an offence punishable by three to five years' imprisonment and a fine of RWF 7,000,000 to RWF 10,000,000 (Article 379), and enforcement is described in IP enforcement and anti-counterfeiting.

Protection depends on the "reasonable steps" test, so a licensor should require written confidentiality undertakings from the licensee and its key staff, mark documents as confidential, restrict access and keep records of disclosure. Software is protected by copyright as a literary work (Article 279), and "computer programs per se, software and their related databases" are excluded from patent protection, although computer-implemented processes and products remain patentable and an applicant for such a patent waives copyright protection for the same subject matter (Article 23). A software licence or assignment is a copyright transaction: an assignment must be in writing and state the rights, duration, territory and remuneration, and rights not listed stay with the author (Article 320).

Licences of right and compulsory licences

A patent owner may ask RDB at any time after grant to record that a licence of right is available, after which any person may use the invention on terms agreed with the owner and approved by RDB, and the annual maintenance fee is halved (Article 48); the offer can be withdrawn if no licence has been granted or all licensees consent (Article 49). The reverse risk is a compulsory licence: a person refused a voluntary licence on reasonable terms may apply to the Minister in charge of intellectual property (Article 50) on grounds that include failure to work the invention in Rwanda or insufficient working in quantity, quality or price, anti-competitive use and dependent patents (Article 51), and the Minister may act on the Minister's own initiative for national security, public health or the environment (Article 57). A foreign patent owner that supplies Rwanda only by import should document why the market is adequately served.

Tax on royalties and paying them abroad

Article 41 of Law N° 027/2022 of 20/10/2022 establishing taxes on income (the Income Tax Law) defines royalty income broadly: payments for the use of, or right to use, copyright in literary, artistic or scientific works including films; trade marks, trade names, designs, models, computer applications, software and patents; industrial, commercial or scientific equipment; and information concerning industrial, commercial or scientific knowledge, which covers know-how. Royalties paid by a Rwandan resident bear 15% withholding tax under Article 60, declared and paid within 15 days after the month of payment, and the payer is personally liable if it fails to withhold (Articles 64 and 66). The treaty texts published by the Rwanda Revenue Authority (RRA) cap royalties at 10% for China, Mauritius, Singapore, South Africa and the United Arab Emirates, against a tax residence certificate submitted with the declaration (Withholding taxes and tax treaties; FAQ 23).

Two limits apply to deductions and VAT. Under Article 25(9) of the Income Tax Law, management, technical service and royalty fees paid to a related non-resident are not deductible to the extent that, in aggregate, they exceed 2% of the payer's turnover, and related-party royalties must also be priced at arm's length under Ministerial Order N° 003/26/10/TC of 29/04/2026 (Transfer pricing and international tax). The cap does not apply to royalties paid to an unrelated franchisor or licensor. For VAT, a licence is an intangible activity performed for payment, so royalties paid to a foreign licensor are an imported service on which the Rwandan business self-accounts for 18% VAT under the reverse charge in Article 14 of Law N° 049/2023 of 05/09/2023 establishing value added tax, recoverable only where the Minister has authorised the deduction for a service not available in Rwanda under Ministerial Order N° 003/24/03/TC of 08/03/2024.

Rwanda also offers an incentive for holding intellectual property in Rwanda. Point II of the Annex to Law N° 006/2021 of 05/02/2021 on Investment Promotion and Facilitation grants a 3% corporate income tax rate on foreign-sourced royalties to a registered investor operating as an intellectual property company that spends at least USD 10,000 a year in Rwanda, has a physical office and a bank account in Rwanda, has Rwandan residents as at least 30% or three of its staff, whichever is higher, and as at least one or 25% of its directors, holds its strategic board meetings in Rwanda and has two qualified Rwandan resident board members (point II(5)), and point X sets withholding tax at 0% on dividends, interest and royalties paid by investors on the 15% and 3% regimes it lists (Kigali International Financial Centre). The investor must hold an RDB investment certificate; the rate is not available to an unregistered company. Payment of royalties abroad is a current transaction that banks process against documents, and Article 12 of the Investment Code separately allows an investor, once its tax obligations in Rwanda are met, to repatriate capital, profits, loan repayments, liquidation proceeds and other assets; the paying bank will ask for the contract, invoice and evidence of withholding tax (Repatriating profits and capital).

Putting a cross-border licence or franchise in place, step by step

1. Register the rights in RwandaFile the marks with RDB or designate Rwanda under the Madrid Protocol, and file any patents nationally, under the PCT or through ARIPO; only registered marks and granted patents can be licensed under Articles 44 and 209.
2. Screen the draft against Articles 47 and 212Remove grant-backs, no-challenge, tying and export clauses; recast territorial, supply and pricing terms so that they are justified by quality control and comply with Article 5 of Law N° 011/2026.
3. Sign in writingBoth parties sign the licence or assignment; Articles 42, 44, 207 and 209 require a written contract signed by both parties, and Article 320 requires writing for copyright assignments.
4. Record with RDBThe licensee or assignee files the contract with the Intellectual Property Division of RDB's Office of the Registrar General, with the fee in RDB's tariff and, for a non-resident filer, through an authorised agent; keep the recordal certificate.
5. Answer any objection within the time allowedIf RDB proposes to refuse recordal, make submissions; a refusal can be appealed to the Appeal Committee within 30 days of notification (Articles 43, 46 and 211).
6. Set up the tax and payment fileObtain the licensor's tax residence certificate, withhold 15% or the treaty rate, declare within 15 days after the month, self-account for reverse-charge VAT and keep transfer pricing support for related-party royalties.
7. Protect the know-howPut confidentiality undertakings in place with the licensee and its staff, limit access and mark documents, so that the information meets the reasonable steps test in Article 276.
8. Notify changes and terminationRecord amendments and assignments, and notify RDB when the licence ends so that it is withdrawn from the register under Articles 45 and 210.